It’s looking more and more like a czar is born. Jeff Shell last week stepped down as CEO of Gemstar-TV Guide International Inc., potentially paving the way for him to take the slot as programming czar at Comcast Corp.
Shell last Friday denied he had any job lined up with Comcast or anyone else. But he is exiting Gemstar nearly five months before his contract expires at the end of April.
“Stepping down five months before the contract had nothing to do with anything, other than, practically, that’s best for the company [Gemstar],” Shell said. “I think Comcast is a fantastic company. I certainly would love to talk to them about positions there. But one of the reasons why I went this direction with Gemstar is I didn’t feel comfortable talking to them or anybody else, while I was under contract, about anything specific. If that should come about, it would be fantastic.”
Sources familiar with the situation several weeks ago said Shell was the leading contender to take the Comcast job, a newly created position that would involve oversight for the MSO’s content portfolio, which includes stakes in services such as E! Entertainment Television, The Golf Channel, TV One, G4TechTV, and Outdoor Life Network. [Multichannel News, Nov. 29].
Last Friday, Gemstar announced that Shell was leaving and being replaced Rich Battista, formerly executive vice president of business development and strategy for the Fox Entertainment Group.
In addition to Battista’s appointment, Gemstar named Anthea Disney as executive chairman, a new post that is in addition to her role as executive vice president of content for News Corp. With her appointment, Lachlan Murodch resigned his position as a Gemstar director.
In an analyst conference call last Friday morning, Shell said that during the past few months there have been informal discussions about his future and the company’s future.
“I’m not going to speculate on what I might be doing,” Shell said. “All I can say definitively is I do not have another job. … It is definitely not official that I’m going to Comcast or anywhere else. … There’s certainly nothing official about anything.”
A Comcast spokesman declined to comment.
A year ago Shell, the former CEO of Fox Cable Networks Group, was first rumored to be under consideration to head up Comcast’s cable networks.
“After spending nearly three years at Gemstar, I’m ready to take on a new challenge,” Shell told analysts Friday. “I made the decision the day before yesterday to go in this direction and informed the board yesterday morning.”
He was willing to stay at Gemstar until the end of April.
“I was perfectly happy to serve out my contract,” Shell said. “When I told the board that I was planning to not renew my contract and resign, I did not indicate that I wanted to or needed to leave immediately.
“They were ready with a replacement. … I think it’s best to let him take over.”
News Corp. owns 41% of Gemstar, and chairman Rupert Murdoch had asked Shell to iron out problems at the troubled onscreen interactive guide company.
Shell succeeded. He joined Gemstar as chief operating officer in May 2002, being named permanent CEO that October.
GEMSTAR SELLING OUT?
Shell’s exit had at least one Wall Street analyst predicting that News Corp. will either acquire all of Gemstar or sell its stake to Liberty Media Corp.
“We believe Gemstar has outlived its purpose as a publicly traded pure play and believe [the] value of assets could be enhanced if owned by a larger entertainment company,” Smith Barney analyst Niraj Gupta wrote in a report Friday.
“We believe the company is likely to be sold to either News Corp. or Liberty Media within the next year.”
Smith Barney also upgraded Gemstar’s stock from a hold, speculative risk, to a buy, high risk.
Shell led Gemstar out of a web of tangled litigation and smoothed over its strained relations with cable operators, forging new distribution deals for Gemstar with big MSOs such as Comcast, Time Warner Cable and Insight Communications Co.
The Comcast pact set up a joint venture for the MSO and Gemstar to develop new IPGs for Comcast and other MSOs.
During the start of Shell’s term, former Gemstar CEO Henry Yuen and a number of old-regime executives faced charges from the Securities & Exchange Commission. Now, Gemstar has an agreement resolving the federal probe into the company.
“Jeff has made invaluable contributions to Gemstar-TV Guide during his tenure, successfully navigating the company through a management and corporate governance restructuring, and was instrumental in resolving many of its business and legal issues,” Murdoch said in a prepared statement.
Battista said his experience at the “intersection of content and new technology” will serve him well at Gemstar.
At Fox Entertainment — which includes Fox’s cable networks, broadcast network, studios and TV stations — Battista said he worked on projects relating to video on demand, digital video recorders, broadband and wireless.
With its interactive guides, Gemstar is very well-positioned in an era when viewers have so many choices, he said.
“Consumers’ television options are rapidly growing, and there is so much confusion about what programming to watch and what new technology means to the viewing experience,” Battista said. “Guidance is going to be critical.”
Shell’s conciliatory attitude with cable operators will also be continued at Gemstar, according to Battista. “I think his approach is right on,” he said. “We need to continue to consider the cable operators our partners.”
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